January
2001
In
the Public Interest: Meeting
the Global Competition
By Ralph Nader
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Imagine the following: The New York Times
announced today that it was replacing its columnists Thomas Friedman
and Paul Krugman with the two leading bilingual writers from the Beijing
Daily. A Times spokesman explained that the move was necessary
to meet the global competition. The two prize-winning Chinese newspaper
columnists—Li Gangsun and Mao Yushi—pledged to work hard
and to write four columns a week, if desired, for $25 a column. Media
analysts
estimated that The Times would reduce its costs by over 95 percent.
An accompanying Times editorial urged other companies and think
tanks to consider opening up their ranks to free trade in executive
talent from Third World countries. “It is time to practice what
we preach and join the globalization movement,” said the editorial,
“and achieve the long-hidden efficiencies from these markets.”
The Times cited two examples where, at retirement, the CEOs
from Boeing and General Electric replaced themselves with highly regarded,
experienced executives from Shanghai and Cuernavaca—who are taking
office with a pay package unheard-of for them of $19,000 a year. These
two gentlemen have long experience with Boeing factory outsourcing in
China, and with GE factories and suppliers moving to Mexico. With today’s
on-line technology, they expect to remain where they are, with occasional
visits to the States.
Tom Freedman’s last column for The Times had a wistful
tone—given
his past paeans to corporate globalization—but it had a defiant
note when he concluded by writing: “I regret that my editors failed
to recognize both my long service to The Times and my double
Pulitzer prizes. It seems that the intangibles of quality and place
have no value anymore. Apparently, everything now is for sale!” At
a departure ceremony, his editors gave Friedman an award for the reporter
who has traveled the most, and predicted that he would have
a fine prospect for employment with the fast-expanding global Chinese
media.
Professor Krugman’s goodbye column was totally different. He developed
an amended theory of comparative advantage to rebut the very thought
of replacing him. “Totally unique commodities like myself,”
wrote the noted economist, “can only adhere to a doctrine of superior
advantage. My eminence cannot be compared to the exchange of early 19th
century Portuguese wine for British textiles.” Krugman declared
that he will return to his full-time faculty post at MIT, where he
will
research how the practice of monopolistic competition can be exempted
from world trade agreements and the imminence of widespread distance
learning.
Li Gangsun’s first column recommended that the Chinese government
bring a number of WTO complaints against the non-tariff trade barriers
erected by the upper classes of U.S. corporations and universities.
“Since everything is for sale,” he wrote, “then all these
positions should be considered ‘commerce and trade’ and opened
to vigorous competition worldwide.” As for those “tenured
economics professors at Harvard and Stanford, who are always testifying
for total free trade between nations,” he wrote, “they are
the essence of impermissible barriers to trade. There are numerous
Chinese
academics who could do a better job, either in situ or by Internet
instruction, at far lower salaries, thus lightening the tuition and
debt load for
American students.”
Word was leaked out that the upcoming meeting of the Business Roundtable,
which will be closed to the press, will have on its agenda a debate
over the topic “Globalization: if it’s good for our workers,
why not our top executives?”
Meanwhile, over at the offices of the U.S. Chamber of Commerce near
the White House, CEO Tom Donahue is huddled with his aides. The Chamber
was planning a joint press conference with its counterpart Mexican
Chamber
of Commerce to protest President Clinton’s clear violation of
NAFTA by banning Mexican truck drivers from access to all 50 states.
Already
the Teamsters Union and consumer safety groups have been emphasizing
the traffic safety hazards of such poorly maintained trucks. Moreover,
Teamster drivers are angry over having to compete with $7-a-day Mexican
drivers.
The aides have new information for Mr. Donahue that is furrowing his
brow. It seems that the head of the Mexican Chamber, Jorge Zapata, after
reading The Times, is preparing an offer to replace Mr. Donahue.
Zapata, a hard-driving, Harvard Business School-trained economist,
is
willing to work for one-eighth of Mr. Donahue’s executive compensation
package, and could move to Washington before the year’s end. This
could also lead to reductions in management salaries at the Chamber
below Mr. Donahue’s level, argues the memo, and result in an overall
reduction in membership dues.
Mr. Donahue heaved a sigh and, deferring comment, suggested
that they all go out for a three-martini lunch.
